Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

EUR/USD falls slightly, amid mixed economic data on both continents

ForexDec 23, 2015 05:24PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
EUR/USD fell by more than 0.40% on Wednesday but closed above 1.09

Investing.com -- EUR/USD fell mildly on Wednesday halting a three-day winning streak, as currency traders reacted to a flurry of mixed data on both sides of the Atlantic.

The currency pair traded in a broad range between 1.0871 and 1.0958, before settling at 1.0910, down 0.0047 or 0.43% on the session. EUR/USD has been virtually flat since the Federal Reserve ended a seven-year zero interest rate policy last Wednesday when it approved its first rate hike in nearly a decade. During a volatile month of trading, the euro has gained more than 3.25% in value against is American counterpart.

EUR/USD likely gained support at 1.0538, the low from December 3 and was met with resistance at 1.1352, the high from Oct. 22.

The dollar held onto gains from the morning session amid a weak batch of data in the euro zone. In France, third quarter GDP was revised down by 0.1% to 1.1% annually, providing a harbinger of potential slowing economic growth in the final quarter of the year. The subdued reading was accompanied by downbeat data in the U.K. where GDP increased by 2.1% annually in the third quarter, decelerating from yearly growth of 2.3% in the previous quarter. It marked the worst third quarter in the U.K. since 2013.

In the U.S, the Department of Commerce's Bureau of Economic Analysis (BEA) said U.S. personal income ticked up by 0.3% in November, marking the eighth consecutive month that the figure moved higher. Analysts forecasted gains of 0.2% last month, following a robust increase of 0.4% in October. It came amid an acceleration in wages and salaries for government workers and an $11.6 billion bonus paid to United Auto Workers employees, one of the nation's largest unions.

As the labor market continues to tighten, nearing full employment, wages and salaries have also increased exponentially. In November, wages rose by 0.5% following gains of 0.6% a month earlier. The strong gains in personal income should support consumer spending and bolster economic growth over the next year. Consumer spending, which represents roughly two-thirds of U.S. economic activity, increased by 0.3% in November, after remaining flat a month earlier.

In terms of inflation, the Personal Consumption Expenditure (PCE) price index remained flat in November, below consensus expectations for a 0.1% gain. On a yearly basis, though, the PCE price index increased by 0.4%, above 0.2% annual gains. The Core PCE index, which strips out volatile food and energy prices, inched up by 0.1% last month, in line with consensus estimates. Over the last year, core prices are up 1.3%, unchanged from October's reading. Core PCE prices, the Fed's preferred gauge for inflation, have fallen below its targeted goal of 2% for every month over the last three years.

The relatively strong inflation data, however, could compel hawkish members of the Federal Open Market Committee (FOMC) to push for another rate hike during the first quarter of next year. In its December monetary policy outlook, the FOMC forecasted that its benchmark Federal Funds Rate could rise by 1.0% over the next 12 months to 1.5% by the end of 2016. On Wednesday, the CME Group's (O:CME) FedWatch placed the probability of a quarter-point hike in March at 53.6%.

The U.S. Dollar Index, which measures the strength of the greenback versus a basket of six other major currencies, rose by more than 0.45% to an intraday high of 98.66, before closing at 98.38. Earlier this month, the index eclipsed 100.00 to reach its highest level in more than 12 months.

EUR/USD falls slightly, amid mixed economic data on both continents
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email